Comments on: Riches — Or Just a Competence?http://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/
Common sense advice on money saving tips, how to get out of debt, high interest savings accounts, cd rates, money market accounts, mortgage rates, money management and more.Sun, 02 Aug 2015 22:20:27 +0000hourly1http://wordpress.org/?v=3.0.1By: La BellaDonnahttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168507
La BellaDonnaTue, 24 Feb 2009 17:47:25 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168507"However, he felt that with his farming and general business knowledge he ought to be able to make a go of it."
But - but - but his farm <b>FAILED!</b> Astounding. Dolley Madison's father made the same mistake; after he and his wife manumitted their slaves, they sold the plantation (no one to work it), and moved to Philadelphia, where Dolley's father, an ardent Quaker, became ... a starch merchant. Yup, a man who eschewed fashion decided to specialize in luxury goods. Goods which were ... going out of fashion. And, of course, the family went from self-sufficient living where they'd grown or made most of what they needed, to having to buy everything. Of course, it wasn't long before he went bankrupt. Just like the hero of this story's father.“However, he felt that with his farming and general business knowledge he ought to be able to make a go of it.”

But – but – but his farm FAILED! Astounding. Dolley Madison’s father made the same mistake; after he and his wife manumitted their slaves, they sold the plantation (no one to work it), and moved to Philadelphia, where Dolley’s father, an ardent Quaker, became … a starch merchant. Yup, a man who eschewed fashion decided to specialize in luxury goods. Goods which were … going out of fashion. And, of course, the family went from self-sufficient living where they’d grown or made most of what they needed, to having to buy everything. Of course, it wasn’t long before he went bankrupt. Just like the hero of this story’s father.

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]]>By: Chrishttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168478
ChrisTue, 24 Feb 2009 15:04:57 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168478I think the answer is somewhere in the middle. The majority of us, by taking SOME risk, can land between the two.I think the answer is somewhere in the middle. The majority of us, by taking SOME risk, can land between the two.

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]]>By: Swintahhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168410
SwintahTue, 24 Feb 2009 01:08:56 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168410This is something you'll likely never read from Kiyosaki and his ilk: a serious treatment of risk to the household from the rabid pursuit of riches.This is something you’ll likely never read from Kiyosaki and his ilk: a serious treatment of risk to the household from the rabid pursuit of riches.

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]]>By: allenhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168394
allenMon, 23 Feb 2009 22:11:51 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168394I love old pieces like this! Interesting to see how our society has changed, and in ways it's stayed the same.
I do have one problem with the piece, which i'm quite sure the author is too much of his weight in worm-food to mind, and that is his statement that one's originating position does not matter, and that only of drive.
I belive the piece itself showed by how much this man was influenced by the opportunities his life gave him, and quite put that concept down.I love old pieces like this! Interesting to see how our society has changed, and in ways it’s stayed the same.

I do have one problem with the piece, which i’m quite sure the author is too much of his weight in worm-food to mind, and that is his statement that one’s originating position does not matter, and that only of drive.

I belive the piece itself showed by how much this man was influenced by the opportunities his life gave him, and quite put that concept down.

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]]>By: Jim Dunnhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168245
Jim DunnSun, 22 Feb 2009 15:29:49 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168245Hey, JD. I'm a recent convert to your way of thinking (and I'm trying to convert my wife), so I've had Get Rich Slowly in my RSS feed for a while. Thanks for helping me change my economic ways.
I'm also a retro blogger who's been friends with Charlie Shopsin for a couple of years. He's one of the nicest guys on the Intarwebs. Glad you could give him a shout. And, since you've mentioned that you like pop culture stuff, you might want to give my blog a look. (If this kind of thing is frowned on, by the way, lemme know and I'll cease posthaste.) Part of the way I'm trying to change my economic fortunes is branding myself, and my blog is a major part of that. It's like James Lileks' blog, only not as good. Here's a link: http://dowhatnow.typepad.com.
Thanks!Hey, JD. I’m a recent convert to your way of thinking (and I’m trying to convert my wife), so I’ve had Get Rich Slowly in my RSS feed for a while. Thanks for helping me change my economic ways.

I’m also a retro blogger who’s been friends with Charlie Shopsin for a couple of years. He’s one of the nicest guys on the Intarwebs. Glad you could give him a shout. And, since you’ve mentioned that you like pop culture stuff, you might want to give my blog a look. (If this kind of thing is frowned on, by the way, lemme know and I’ll cease posthaste.) Part of the way I’m trying to change my economic fortunes is branding myself, and my blog is a major part of that. It’s like James Lileks’ blog, only not as good. Here’s a link: http://dowhatnow.typepad.com.

Thanks!

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]]>By: Kelleyhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168230
KelleySun, 22 Feb 2009 05:21:17 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168230I know one of the reasons I'm a saver and a non risk taker is because I've seen my parents squander opportunities and businesses my entire life. We're doing everything right at this point in our lives (late 20's w/2 kids). It just makes me wonder how my children will view money, what it is they'll learn from us, or if they'll want to live more dangerously after having grown up in a financially sound environment.I know one of the reasons I’m a saver and a non risk taker is because I’ve seen my parents squander opportunities and businesses my entire life. We’re doing everything right at this point in our lives (late 20′s w/2 kids). It just makes me wonder how my children will view money, what it is they’ll learn from us, or if they’ll want to live more dangerously after having grown up in a financially sound environment.

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]]>By: Matthttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168210
MattSun, 22 Feb 2009 01:02:55 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168210I was going to write a long post about risk, but Austin hit it right on the head... you have to understand what risk you are assuming.
The father went into nearly every venture with blinders on, not knowing fully what he was getting himself into. Calculated risk is key.I was going to write a long post about risk, but Austin hit it right on the head… you have to understand what risk you are assuming.

The father went into nearly every venture with blinders on, not knowing fully what he was getting himself into. Calculated risk is key.

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]]>By: MitchKhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168195
MitchKSat, 21 Feb 2009 23:10:52 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168195I am the type of man that the author is, not a risk-taker like a Rockefeller. But I am damn grateful for people that risk it all on an idea, who aren't satisfied with the status quo. Without risk-takers, we wouldn't have much progress at all.I am the type of man that the author is, not a risk-taker like a Rockefeller. But I am damn grateful for people that risk it all on an idea, who aren’t satisfied with the status quo. Without risk-takers, we wouldn’t have much progress at all.

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]]>By: Austinhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168194
AustinSat, 21 Feb 2009 22:33:21 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168194I think an important lesson from this story is that being misinformed on how to build wealth is probably a sure way to financial disaster. The part that caught my attention was: "He was not well versed in the ways of the hide and wool industry. However, he felt that with his farming and general business knowledge he ought to be able to make a go of it. He had not expected to go into commerce on so small a capital, but the opening had suddenly appeared, and he felt that he could not afford to miss the chance."
If you ask me, the father made a very poor decision based on limited information. He didn't even understand the business he was buying. Then he made the ridiculous assumption that his expertise in farming would somehow translate into understanding the wool/hide business. Lastly, he was undercapitalized.
For example, just because you can make a great burger doesn't mean you will experience success similar to McDonald's. McDonald's isn't famous for great tasting burgers but the consistency and efficiency in their process and product.
For Rockefeller, Standard Oil didn't become successful because it simply offered a great product. It sold oil which was only a commodity. It was just a matter of generating enough volume of business in the most efficient way. Rockefeller understood this because he had extensive expertise in commodities accounting. However, he was also an excellent manager who assembled a loyal and talented workforce. In other words, the company could still progress without him.
The defining difference between the "Wool/Hide" man and Rockefeller is that the former made decisions that only increased the probability of failure while the latter made decisions which aimed at lowering this probablity. Although we see both of them making risky investments, we also see that only one of them knew how to play the game with the odds in his favor.
"Work on your business, not IN it." ~Michael Gerber (E-Myth revisited)I think an important lesson from this story is that being misinformed on how to build wealth is probably a sure way to financial disaster. The part that caught my attention was: “He was not well versed in the ways of the hide and wool industry. However, he felt that with his farming and general business knowledge he ought to be able to make a go of it. He had not expected to go into commerce on so small a capital, but the opening had suddenly appeared, and he felt that he could not afford to miss the chance.”

If you ask me, the father made a very poor decision based on limited information. He didn’t even understand the business he was buying. Then he made the ridiculous assumption that his expertise in farming would somehow translate into understanding the wool/hide business. Lastly, he was undercapitalized.

For example, just because you can make a great burger doesn’t mean you will experience success similar to McDonald’s. McDonald’s isn’t famous for great tasting burgers but the consistency and efficiency in their process and product.

For Rockefeller, Standard Oil didn’t become successful because it simply offered a great product. It sold oil which was only a commodity. It was just a matter of generating enough volume of business in the most efficient way. Rockefeller understood this because he had extensive expertise in commodities accounting. However, he was also an excellent manager who assembled a loyal and talented workforce. In other words, the company could still progress without him.

The defining difference between the “Wool/Hide” man and Rockefeller is that the former made decisions that only increased the probability of failure while the latter made decisions which aimed at lowering this probablity. Although we see both of them making risky investments, we also see that only one of them knew how to play the game with the odds in his favor.

]]>By: Melissahttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168191
MelissaSat, 21 Feb 2009 21:53:41 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168191I'm so glad that everyone liked the article. When I first started reading it a little while back, I immediately though that the GRS readers (and JD) would like it.
On my first reading, I also wondered what impact the Great Depression had on this man. I'm sure he was able to ride it out, but I would have been interested to read his thoughts on personal finance 10 years after this article was written.I’m so glad that everyone liked the article. When I first started reading it a little while back, I immediately though that the GRS readers (and JD) would like it.

On my first reading, I also wondered what impact the Great Depression had on this man. I’m sure he was able to ride it out, but I would have been interested to read his thoughts on personal finance 10 years after this article was written.

]]>By: Dayflyerhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168176
DayflyerSat, 21 Feb 2009 19:11:30 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168176A very thought provoking read. We all have our own equation of risk against safety, and our early family experiences are likely to have exerted some influence on this.
It's interesting how often children take the opposite path to their parents as a reaction to something negative from their childhood.A very thought provoking read. We all have our own equation of risk against safety, and our early family experiences are likely to have exerted some influence on this.

It’s interesting how often children take the opposite path to their parents as a reaction to something negative from their childhood.

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]]>By: Bill in NChttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168174
Bill in NCSat, 21 Feb 2009 19:05:05 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168174"Rockefeller was clearly more successful of the two"
Except with his strategy statistically you are much more likely to fail (end up like the father) than have anything at all.
Big risks = big losses for almost everyone who tries that strategy (whether gambling or buying the junkiest of bonds)“Rockefeller was clearly more successful of the two”

Except with his strategy statistically you are much more likely to fail (end up like the father) than have anything at all.

Big risks = big losses for almost everyone who tries that strategy (whether gambling or buying the junkiest of bonds)

]]>By: Camille@TheFinancialWoman.comhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168168
Camille@TheFinancialWoman.comSat, 21 Feb 2009 17:16:33 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168168I enjoyed Allison's comments which led me to the following thoughts...Is the main point of the story that our childhood heavily influences our financial futures? Rockefeller was clearly more successful of the two and made huge financial contributions to society. Is the point that it is better to take no risk at all and have enough saved for existence in later life, or to take reasonable and well calculated risks and thus potential greater wealth? I tend to think the later.
I also could not help but wonder if the more conservative man would have lost his bank savings in the Great Depression. Is there a sense of hoarding, scarcity and lack of enjoyment, like the childhood baseball longing, of what he did earn due to fear? Did he truly utilize his talents with his work or hold back out of fear of loss and just settle?
Thought provoking read. Thanks for sharing. Love the photos!I enjoyed Allison’s comments which led me to the following thoughts…Is the main point of the story that our childhood heavily influences our financial futures? Rockefeller was clearly more successful of the two and made huge financial contributions to society. Is the point that it is better to take no risk at all and have enough saved for existence in later life, or to take reasonable and well calculated risks and thus potential greater wealth? I tend to think the later.

I also could not help but wonder if the more conservative man would have lost his bank savings in the Great Depression. Is there a sense of hoarding, scarcity and lack of enjoyment, like the childhood baseball longing, of what he did earn due to fear? Did he truly utilize his talents with his work or hold back out of fear of loss and just settle?

Thought provoking read. Thanks for sharing. Love the photos!

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]]>By: Allisonhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168162
AllisonSat, 21 Feb 2009 16:22:59 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168162The man portrayed in the article was influenced by a father who took risks in an attempt to become rich. This influence motivated him to become a hard worker not given to risks or interested in quick wealth. He came to believe in stocks and mortgages.
By contrast, Rockefeller's take on money was influenced by an itinerant father (a risky way of life). Rockefeller went the opposite way of the profiled gentlemen, become rich from risky investments. By the time the 1873 and 1929 depressions hit, he was able to sail through them.
I'm no economics whiz and have no idea how old the profiled gentleman was, so I wonder if his faith in gilt-edge stocks and farm mortgages remained high when the "Great Depression" hit in 1929 (as careful as he was, he would have possibly seen it coming when signs appeared in the early '20s). My guess is that he may have suffered, but would have been able to ride it out.
Very interesting comparison of two very different men influenced by different family situations and economic times.The man portrayed in the article was influenced by a father who took risks in an attempt to become rich. This influence motivated him to become a hard worker not given to risks or interested in quick wealth. He came to believe in stocks and mortgages.

By contrast, Rockefeller’s take on money was influenced by an itinerant father (a risky way of life). Rockefeller went the opposite way of the profiled gentlemen, become rich from risky investments. By the time the 1873 and 1929 depressions hit, he was able to sail through them.

I’m no economics whiz and have no idea how old the profiled gentleman was, so I wonder if his faith in gilt-edge stocks and farm mortgages remained high when the “Great Depression” hit in 1929 (as careful as he was, he would have possibly seen it coming when signs appeared in the early ’20s). My guess is that he may have suffered, but would have been able to ride it out.

Very interesting comparison of two very different men influenced by different family situations and economic times.

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]]>By: Jorgehttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168159
JorgeSat, 21 Feb 2009 15:45:02 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168159Great post! It just goes to show that the principles of achieving wealth don't ever really change over time. The tools to get there may, but the principles endure. Spend less than you earn, manager your risk and invest for the long term.
Fantastic!Great post! It just goes to show that the principles of achieving wealth don’t ever really change over time. The tools to get there may, but the principles endure. Spend less than you earn, manager your risk and invest for the long term.

]]>By: Chett Danielhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168153
Chett DanielSat, 21 Feb 2009 13:13:08 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168153I would only read something this long on your site. Great post.I would only read something this long on your site. Great post.

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]]>By: DDFD at DivorcedDadFrugalDadhttp://www.getrichslowly.org/blog/2009/02/21/riches-or-just-a-competence/comment-page-1/#comment-168152
DDFD at DivorcedDadFrugalDadSat, 21 Feb 2009 13:09:57 +0000http://www.getrichslowly.org/blog/?p=2329#comment-168152Nice post-- these are age old ideas that are still true today. A good read!Nice post– these are age old ideas that are still true today. A good read!